A wind energy project secured through auctions should have a minimum size of 25 MW if it supplies power to one state and 50 MW if it supplies to more than one state, say the guidelines for wind auctions.
Wind energy projects should have a minimum capacity utilisation factor (CUF) of 22% and will be penalised if they fall below that mark. If the CUF is higher than specified in the bid document, the excess power will be paid for by the buyer at 75% of the tariff decided, according to the guidelines issued by the power ministry on Friday.
Wind developers must indicate the location of their projects in their applications and show evidence within seven months of the signing of the power purchase agreements (PPAs) that they have actually acquired full rights for 25 years to all the land they will need to set up their projects, the guidelines said.
Three wind auctions — two by Solar Corporation of India (SECI), an arm of the ministry of new and renewable energy, and one by the Tamil Nadu power utility Tamil Nadu Generation and Distribution Co (Tangedco) — have already been held this year despite the absence of guidelines.
Lobbies representing wind developers and manufacturers have been protesting the holding of auctions without the guidelines being issued, which they claimed contravened Section 63 of the Electricity Act, 2003.
A 500 MW auction by Gujarat’s distribution company Gujarat Urja Vikas Nigam Ltd (GUVNL) is currently held up because Indian Wind Energy Association (Inwea) moved the Supreme Court to oppose holding it without the guidelines.
A frequent problem wind developers face is that of discoms ‘backing down’ their power – unplugging their transmission from the grid when it gets overloaded.
The guidelines have now laid down that such back downs should be avoided.
“No wind power plant, duly commissioned, should be directed to ‘back down’ by a discom or load dispatch centre,” they said. “In case such eventuality of back down arises, except when the back down is on account of grid security or safety…the generator shall be eligible for generation compensation,” the guidelines said. It said the government “encourages a ‘must run’ for wind power projects”.
According to the guidelines, the period of a power purchase agreement (PPA) should be minimum 25 years. If there are any changes in the relevant laws over the 25 years of the contract that cause financial losses to the developers, they have to be compensated for it by the power procurer. They also lay down that if the discom concerned is unable to evacuate the power agreed upon at any particular time for no fault of the wind energy generator, it must offset this loss by accepting the same amount of additional power over the next three years and paying for it.
Numerous other conditions to be satisfied by both the developers and the discoms have been laid down to ensure smooth functioning of the bidding process and subsequent supply of power.
Auctions of both the closed bid variety – where tenders quoting a fixed price are submitted – and the open bid, or reverse e-auction kind – in which following an initial bid, contestants can keep adjusting their prices – have been allowed.